AFI Europe obtained the construction permit for its second mall in Bucharest
AFI Europe obtained the construction permit for its second mall in Bucharest, located in Bucurestii Noi, the development being due to start this year or in the first months of next year and also intends the development of 60,000 sq. m office complex on the plot of the former Inox factory.
"Although it is a long way to get the financing, we will be successful eventually. This encourages us to start new projects. In Bucureştii Noi we got the construction permits a few weeks ago and we are negotiating the financing. From the 28,000 sq m we already have 12,000sq.m rented and we intend to open during 2014. The construction could start this year or at the beginning of the next year", has declared for MEDIAFAX David Hay, the executive director of AFI Europe România.
Asked if he feels lucky because AFI is among the few real estate companies still getting bank financing for the developed projects, Hay said it is not a matter of being lucky.
"It is not luck; as if it was luck I would have been sceptical. To get credits now you need to be an existing client of the bank, a very good client, with a good history. The project should be the best possible in terms of location, access, public transportation, design, tenants mix, pre-leases. Moreover, currently for obtaining financing you should bring more capital of your own then needed before. Now you have to bring for the retail projects 35-45% of the investment. For a retail project it is a lot of money and many developers simply cannot bring these funds, this is why it is difficult to get financing. ", the developer representative explained.
He added that AFI Europe "is lucky" to meet all these parameters.
In Bucureştii Noi area there is another mall construction announced, Collosseum retail park, developed by Nova Imobiliare, with British capital.
"I don’t believe the mall development will begin. As far as I know they are not doing that well, I know there are other projects in the area but I don’t think that Colloseum will start. I cannot see for the moment a real competition in the area", Hay said.
The company owns on Bucureştii Noi Blvd. a plot of land of 65,000 sq.m.
AFI also owns a plot in Arad, where they intentioned to develop a retail park, but the construction was stopped because of the city’s big concurrence.
"Arad is a difficult city for retail, we have the permit, but we are not going to develop speculatively. When we will sign lease agreements we will start. Some time will passes until we will start in Arad. ", Hay said.
Regarding the office segment, apart from the office complex near AFI Palace Cotroceni, the company intends to build a similar project on the plot of the former Inox factory, near the Marriott Hotel, with an area over 17,000 sqm. Initially the company planned to develop on the plot a residential complex.
"We have in plan another office park, on the location of the former Inox factory, across the road from Vulcan. We intend to develop a business park of approx. 60,000 sqm, mainly offices, we planned to start the construction in two years. After the completion of AFI Park we will start the works for this project, which will be developed in 3-5 phases, it depends on how we split it. ", said Hay.
He says that Romania is a country with potential, and once the problems in Europe solved, the investors will see this potential.
"A part of the market already sees this potential, fofr exemple the IT sector. There are more and more companies extending in Romania. We can see an influx of IT companies; we will see an influx of BPO (business process outsourcing) companies. These understood that the Polish market, where they already are present, it is very developed and the next destination will be Romania.", Hay stated.
He concluded that it is very important that the Government to focus on the infrastructure and on the education:
"Romania has a very educated labour, with skills, who wants to work and expand its knowledge. We see tough a decrease of the education level from one year to another and I think the Government should prevent this degradation, Romania risks to lose this advantage it has upon other countries.
AFI Europe is a member of AFI Group and develops and manages commercial and residential projects in Romania, the Czech Republic, Serbia, Poland, Bulgaria, Germany and Latvia. (source: zf.ro)